Indian stock benchmarks rebounded on Friday as dovish US Federal Reserve signals calmed investor nerves. While the Sensex and Nifty finished higher, weekly gains remained elusive due to geopolitical tensions. Investors are now shifting focus to a busy primary market, with 11 IPOs expected next week.
Indian stock markets finally took a breather on Friday, September 4, snapping a four-day losing streak that had kept investors on edge. Both the BSE Sensex and NSE Nifty 50 closed in positive territory, finding support from positive cues from the United States. The Sensex rose 362.57 points or 0.48% to finish at 76,515.43, while the Nifty 50 added 24.25 points or 0.10% to settle at 23,897.70.
The relief rally was largely driven by comments from US Federal Reserve Governor Christopher Waller. His suggestions that interest rates might remain steady at the upcoming policy meeting provided much-needed comfort to global markets, which have been worried about high borrowing costs. Additionally, data showing a cooling in the US labor market reduced fears of the economy overheating, further boosting investor sentiment.
Despite the gains, trading remained selective. Metals and financial service stocks saw buying interest, helping the indices stay afloat. However, weakness persisted in segments like IT, healthcare, and real estate, where sellers remained active. This divergence shows that while the broader market found stability, specific sectors are still feeling the pressure of global uncertainty.
Investors are currently juggling these positive global cues against persistent local risks. Geopolitical tensions in the Middle East continue to cast a shadow, keeping Brent crude prices near $95 per barrel. This is a crucial number for India, as higher oil costs often weigh on corporate profit margins and trade balance. For the week as a whole, both indices actually closed with a decline of about 1%, reflecting that the market remains cautious.
On the domestic front, the economy continues to show resilience. India’s GDP growth for the first quarter of the 2027 fiscal year stood at 7.8%, a figure that beat market estimates. The Indian rupee also showed strength, ending near 94.50 against the dollar, supported by consistent foreign deposit inflows.
Looking ahead, market participants will be monitoring the upcoming US inflation data, as it will likely determine the direction of global fund flows. At home, the primary market is set for a busy period, with eleven new public issues (IPOs) scheduled to hit the market next week, targeting to raise over ₹7,000 crore. Investors will likely be watching how the market absorbs this large supply of new shares amid the ongoing global instability.